Expanding Medicaid: Close the Budget Gap. Check. Insure Thousands of Pennsylvanians. Check.

Michael Passiment |

As lawmakers continue debating how to close a $1.5 billion budget gap, there is a particularly valuable and compassionate policy option still on the table: Medicaid expansion. Under the Affordable Care Act (ACA), the federal government will commit to paying 100% of coverage costs for new enrollees under Medicaid expansion, through 2016. This has the combined effect of easing the financial burden of the state and giving hundreds of thousands of Pennsylvanians access to health care coverage.

In an editorial posted to the Patriot News last week, Jennifer Clarke and Laura Smith of the Public Interest Law Center of Philadelphia (PILCOP) urged legislators to adopt a bill expanding Medicaid and allowing the state to move past ‘Corbettcare’.

The bill, introduced by Rep. Gene DiGirolamo (R-Bucks), has been approved by the House Human Services Committee and is pending a floor vote. A similar bill to allow the state to expand Medicaid passed the state Senate by a vote of 40-10 last year, only to die in the House in a dramatic floor vote in the waning days of the session.

Expanding Medicaid will allow Pennsylvania to close its budget gap and strengthen its economy. The Independent Fiscal Office has reported that savings and new revenue from the federal government will add $620 million to the state’s 2014-15 budget. The RAND Corporation has also found that expansion can spur job creation. Plus a majority of Pennsylvanians support Medicaid expansion, 59% according to an April 2014 poll by Public Policy Polling.

Because of Governor Corbett’s decision not to expand Medicaid, Pennsylvania is missing out on an estimated $5 to $10 million in federal funds with each passing day.[1]

The Corbett administration has complained about costs associated with implementation of the Affordable Care Act, but neglect to mention state savings from the ACA, which are in addition to savings from Medicaid expansion.

A new analysis from the House Democratic Appropriations committee has calculated those savings at $590 million in 2014-15:

  • $339 million from drug rebates in the managed care program
  • $75 million in an enhanced federal match through the ACA balancing incentive program, which promotes greater use of home and community-based services
  • $60-$70 million in savings in the PACE senior prescription drug program
  • $116 million from 100% federal funding for individuals who are currently receiving health care in state-funded programs.

The savings from Medicaid expansion will have an immediate benefit for Pennsylvania. “If we begin expansion immediately, we could still save more than $240 million in 2014/15—which is $127 million more in savings than under Gov. Corbett’s Healthy PA plan.”[2]

Now is the time to expand Medicaid, close the budget gap, and offer health coverage to those most in need. Rep. DiGirolamo’s bill does just that.


[1] Jennifer Clarke and Laura Smith, “Forgett Corbettcare, DiGirolamo’s Medicaid bill is the way to go”, June 20, 2014 http://www.pennlive.com/opinion/2014/06/forget_corbettcare_digirolamos.html

[2] Joseph Markosek, “Affordable Care Act Savings Exceed $590 Million in the 2014/15 Budget”, June 23, 2014 http://www.pahouse.com/HACD/series/2800/DPW_ACA_Savings_MSG_062314.pdf